(Transcript of audio with descriptions. Transcript includes narrator headings and description headings of the visual content)
(Speaker)
Now that you have calculated the marginal product and the value of the marginal product of labor, this problem is going to ask you to determine the optimal number of workers Patty should employ.
(Description)
The table from the previous slide is shown. The only difference is that the values in columns, MPL (pizzas per worker), and, VMPL subscript 1 (per worker) (price of pizza equals 2 dollars), are simplified.
Now the column, MPL (pizzas per worker), consists of the following values starting from the first row: blank, 9, 6, 4, 3, and 2, respectively.
The column, VMPL subscript 1 (per worker) (price of pizza equals 2 dollars), consists of the following values starting from the first row: blank, 18, 12, 8, 6, and 2, respectively.
The following text is written above the table:
Patty's Pizza Parlor has the production function per hour shown in the accompanying table. The hourly wage rate for each worker is 10 dollars. Each pizza sells for 2 dollars.
The following text is briefly written below the table:
B. Using the table above, find how many workers Patty should employ.
(Speaker)
Patty should hire workers up to the point where the value of the marginal production of labor equals the wage rate. For Patty, this means hiring the second worker.
The second worker provides a value of 12 dollars and only costs 10 dollars.
(Description)
The third row of the table with the corresponding data is highlighted. It is labeled as Patty will employ more workers as long as the VMPL is greater than the wage rate. For Patty she will hire 2 workers.
(Speaker)
Patty should not hire the third worker as they only provide 8 dollars of value, but cost 10 dollars.